AVAX is the first layer blockchain currency for Avalanche smart contracts and is currently trading at 28.25. So, why do I feel that AVAX will continue to rise and perform well in this bull market? This article will explore this issue from multiple perspectives.
Demand for Avalanche isn’t due to FOMO
Avalanche is not the only altcoin to recover in the past 24 hours. Many other coins in the top 20 by market capitalization have done the same thing. However, not all cryptocurrencies can sustain their rally. But AVAX is not one of them.
Increase in social search volume: First, we looked at social search volume. Avalanche's social search volume has reached a new high since June 27 and remains at a healthy high as of press time. Social dominance measures the level of searches for a cryptocurrency. Typically, when there are major developments, random searches for the asset rise.
For example, Solana (SOL) has experienced gains in the index. This was prompted by an increase in the number of applications for the Solana ETF, suggesting participants were buying it out of FOMO. Meaning positive developments spark demand for SOL and drive prices higher.
As far as AVAX is concerned, there is no such thing. So it seems natural that social volume is rising, reflecting a strong rise in trust. If the index continues to rise, AVAX may avoid a pullback. Instead, it may experience a more significant upward move than the 6.32% recorded in the past 24 hours. Historical data also supports this trend, with the coin rising sharply to 36.80 on June 6.
Support appears, ready to pull up?
As with social volume, the Money In/Out (IOMAP) index surrounding price supports higher value for AVAX in the short term. IOMAP measures the price range at which currency holders can purchase their tokens. Through this indicator, traders can identify areas of support or resistance. The more addresses that accumulate at a certain point, the more support or resistance it has.
IOMAP shows that 4,100 addresses purchased 2.62 million AVAX at an average price of 28.54. At the same time, 53,540 addresses purchased 1.21 million tokens at an average price of 27.29.
While those who bought at $28.54 were losing money, those who bought at $27.29 were making money. Therefore, the upside may support the rise in AVAX, which may help the cryptocurrency surpass the resistance at 28.54.
Buying pressure keeps it rising
The daily chart makes a similar point to the on-chain analysis above. Reflected in the Fibonacci retracement indicator, this indicator indicates whether the cryptocurrency will continue its current trend or reverse. It determines the price milestone to be reached or the level at which it can be reversed. As of the time of publication, AVAX is approaching resistance at 28.54, the 0.238 Fibonacci level.
In addition, the CMF index also left negative territory. CMF measures cash flow. Combined with other indicators, it can use buying or selling pressure levels to show whether a trend will continue. Therefore, a rise to 0.04 means Avalanche tokens are being purchased.
If this situation continues, AVAX price may reach the first target of 31.39. If bulls manage to move above any potential resistance, AVAX could move higher. However, this prediction may become invalid if demand for the token declines. CMF is another factor that could weigh on AVAX's price. If the CMF reaches 0.20, the cryptocurrency will be overbought. If this happens, prices may drop. In the event of an extreme decline, it will drop to 23.92.
Conclusion
The AVAX token is showing strong upside potential across multiple metrics. Whether it is social search volume, IOMAP index or CMF index, it all shows that the market has positive expectations for it. However, investors still need to be cautious and pay close attention to market dynamics and changes in related indicators.
Later, we will bring you analysis of leading projects on other tracks. If you are interested, please click follow. I will also compile some cutting-edge information and project reviews from time to time, and welcome like-minded people in the currency circle to explore together. If you have any questions, you can comment or send a private message.